Economists had earlier predicted that New Zealand’s economy would grow again in the second quarter. They estimated a rise in GDP between 0.4% and 0.8% for the June quarter. Factors like improved dairy, forestry, and meat exports contributed to the 0.9% growth. Jason Attewell from Stats NZ highlighted that business services, especially computer system design, played a significant role in this growth.
Manufacturing activity also went up in the second quarter, ending five previous quarters of decline. The growth in the March 2023 quarter was adjusted from -0.1% to 0%. Meanwhile, the December 2022 quarter saw a decline of 0.5%, which was a revision from the earlier -0.7%.
Darren Gibbs, a senior economist at Westpac, mentioned that due to these revisions, the recession might be averted for now. ASB’s Nathaniell Keall noted that the GDP’s rise was considerably higher than anticipated. He added that while net migration remains robust, the GDP’s per capita growth was a smaller 0.2% for the quarter.
However, some experts think that factors like higher interest rates and decreased export prices might push the country back into a recession. Keall mentioned that while New Zealand’s economy seems sturdy now, it’s expected to slow down in the coming 12-18 months.
ANZ suggested being cautious, using the term “dead cat bounce,” hinting at a temporary recovery. Mary Jo Vergara, a senior economist at Kiwibank, last week expressed concerns about the upcoming period.
